On 1 July 2014 Stokes Ltd acquires 25 per cent of the issued capital of Cotter Ltd for a cash consideration of $120 000. At the date of acquisition, the shareholders equity of Cotter Ltd is: Share capital $150 000 Retained earnings $100 000 Total shareholders equity $250 000 Additional information: ? On the date of acquisition, buildings have a carrying amount in the accounts of Cotter Ltd of $80 000 and a market value of $100 000. The buildings have an estimated useful life of 10 years after 1 July 2014. ? For the year ending 30 June 2015 Cotter Ltd records an after-tax profit of $30 000, from which it pays a dividend of $10 000. ? For the year ending 30 June 2016 Cotter Ltd records an after-tax profit of $100 000, from which it pays a dividend of $50 000. ? Stokes LTD. Has a number of subsidiaries ? Assume a tax rate of 30% is assumed Required: Applying equity method of accounting (a) Calculate the amount of goodwill at the date of acquisition. (3 marks) (b) Prepare the journal entries for the year ending 30 June 2015. (3 marks) (c) Prepare the journal entries for the year ending 30 June 2016. (6 marks)